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Wealth Traps

We are all trying to get ahead in life. Financial independence was a 30-year goal of mine. I wanted to know I could take care of myself and my family without worry. There are lots of reasons why people are not wealthy. Sometimes they simply do not want to be. For others, they get stuck in wealth traps.

Here are the seven traps Tanz Loudenback talks about below in her article:

You’re comfortable in your job – Take a job that puts you out of your comfort zone and challenges you to grow.

Avoid risk – The more ambitious the financial goal, the greater the risk involved.

Holding on to toxic friendships – Remember, you are the average of the 5 people you hang out with. Learning to discern the people that don’t have a positive impact on you is a powerful skill.

Victimizing yourself – Don’t linger in doubt and self-pity. Look for an action you can take to make your current situation better.

Thinking you know it all – There’s always more to learn. I’m 56 years old and I am still focused on learning and trying to get better at everything I do. This habit came from working to be financially independent all those decades.

Keep these in mind as you go through your day today. What traps have you set for yourself?

Rule #18 from my book The Fantastic Life: Do Nothing in Moderation
If you have a goal, don’t pursue it half-heartedly. If you want to be wealthy, don’t “give it your best shot” and then be content to fall short. Wealth comes to those who pursue it doggedly.

7 Reasons You’re Not a Millionaire Yet, According to 2 People Who AreThey call them the 7 ‘wealth traps.’
By: Tanza Loudenback
April 28th, 2017

Osborn is the operating partner of Keller Williams Realty and managing partner at private equity group Align Capital. Morris is the CEO of the second-largest Keller Williams franchise, located in Beverly Hills, California.

One of the first steps on the journey to building wealth, Obsorn and Morris say, is identifying and conquering the seven “wealth traps,” or ways you could be inhibiting yourself from reaching your goals.

“To build awareness and enhance your state of mind, think of someone who is less talented, less hardworking, less smart, and less of whatever it is you are good at, yet has more wealth than you. The odds are that person has escaped the wealth traps,” they write.

Below, check out the seven wealth traps and how to avoid them.

1. Staying in a comfortable job
It’s easy to get comfortable in a job you enjoy, or even seek out a position that aligns with your interests. For example, Osborn and Morris write in their book, a ski instructor who loves to ski or a bartender who loves to meet new people and be social.

“All of these individuals are getting some subset of their needs met,” they write. “But is it enough?”

Osborn and Morris encourage you to use your learned skills to find interests outside of your comfort zone. “Building wealth is a contact sport. It requires movement, action, and impact. Be purposeful and build a network that takes you closer to your goals,” they write.

2. Avoiding risk
Fear is a universal feeling. Once you realize you’re not alone in that feeling, “ask yourself, ‘What is truly at risk?'” Osborn and Morris write.

Remember, if it’s a worthwhile endeavor, there will almost certainly be some sort of risk involved.

“We’re not going to sugarcoat this — building wealth involves taking risks,” they write. “But it’s overinflated compared to the risk of doing nothing. The biggest risk in life is not taking one.”

3. Viewing wealth negatively
We’re all brought up around different attitudes about money, whether that’s the idea that wealth is glamourous and unattainable, or that it’s a sign of greed and corruption.

“Celebrate your pursuit of wealth and look at it as a pathway to freedom. And, steer clear from those who think money is a dirty word,” they write.

4. Giving up
As with any challenge in life, you’ll experience ups and downs in your pursuit of wealth. Those people who make it to the top are the ones who never quit.

Osborn and Morris explain:
“When you face a setback, you have a choice: You can jump ship by focusing on the sting of the loss or stay the course and reap the value of the lesson.

“Just remember: You had courage before the loss, and now you have the power of more experience and information as you move forward.”

5. Holding on to toxic friendships
“How many people are best friends with their kindergarten buddies? Not many. Yet how many folks have a friend they won’t cut loose, even though they are a negative influence?”

Osborn and Morris ask these questions to emphasize that you have total control over who you surround yourself with. Ultimately, they say, don’t get trapped in a “weak social circle.” If you do find yourself there, be sensible enough to walk away.

6. Victimizing yourself
Bad things happen every day and at times it may even feel like you’re taking more hits than others. Did you lose money on your investment? Run your new business into the ground? That’s going to be difficult to get through, but it’s no excuse to victimize yourself, Osborn and Morris explain.

“Victimhood leads to blame, apathy, and general malaise. It’s hard to move forward with a positive vision when you are locked into an event from the past. Negativity tends to lead to inertia and despondence. Don’t let a bad occurrence hold you back,” they write.

7. Thinking you know it all
Osborn and Morris quote Stephen Hawking to illustrate this point: “The greatest enemy of knowledge is not ignorance, it’s the illusion of knowledge.”

Thus, thinking you know all there is to know — the “expert syndrome,” as they call it — hinders teachability and growth.